DEFA14A: Nano Dimension to Acquire Markforged in All-Cash Deal, Strengthening Additive Manufacturing Leadership

Nano Dimension announced an all-cash acquisition of Markforged for approximately $115 million, aiming to strengthen its position in the additive manufacturing industry.

Summary

• Nano Dimension is set to acquire Markforged in an all-cash transaction.
• The deal is valued at approximately $115 million, or $5.00 per Markforged share.
• This represents a 71.8% premium to Markforged's September 24th, 2024 VWAP.
• The acquisition is fully financed by cash on Nano Dimension's balance sheet.
• The transaction is expected to close in Q1 2025, subject to Markforged shareholder approval, CFIUS clearance, and other regulatory approvals.
• The combined revenue of Nano Dimension, Desktop Metal, and Markforged is expected to be $340 million based on the last full year (2023).
• The acquisition aims to strengthen Nano Dimension's leadership in additive manufacturing and build a comprehensive portfolio of solutions.
• Markforged reported $93.8 million in revenue in 2023, with 37% being recurring revenue.
• Markforged's gross margin was 47.4% (48.6% non-GAAP) in 2023.
• Nano Dimension expects near-term efficiencies from the acquisition due to nearby Boston locations and the elimination of duplicative public company expenses.
• The combined company is expected to have $475 million in cash and cash equivalents to support growth.

Sentiment

Score: 7

Explanation: The document presents a positive outlook on the acquisition, highlighting potential synergies and growth opportunities. However, it also acknowledges risks and uncertainties, resulting in a moderately positive sentiment score.

Positives

• The acquisition strengthens Nano Dimension's leadership in additive manufacturing.
• The combined company will have a more comprehensive portfolio of solutions.
• Markforged's recurring revenue stream (37% of $93.8 million in 2023) adds stability.
• Synergies are expected from nearby Boston locations and reduced public company expenses.
• The all-cash deal is fully financed by Nano Dimension's balance sheet.
• The acquisition provides Nano Dimension with critical AM capabilities for an even stronger Industry 4.0 portfolio of solutions.

Risks

• The acquisition is subject to closing conditions, including shareholder approval and regulatory clearances.
• The integration of Markforged may present challenges.
• The forward-looking statements are subject to risks and uncertainties as detailed in SEC filings.
• The combined company financial information has not been audited or reviewed.

Future Outlook

The acquisition is expected to strengthen Nano Dimension's leadership in additive manufacturing and build a comprehensive portfolio of solutions, driving future growth.

Industry Context

The acquisition reflects a trend of consolidation in the additive manufacturing industry, with companies seeking to expand their capabilities and market reach through strategic mergers and acquisitions.

Comparison to Industry Standards

• The document mentions Desktop Metal as another player in the additive manufacturing space, highlighting the competitive landscape.
• The focus on metal and composite materials aligns with the industry's shift towards high-performance applications.
• The emphasis on recurring revenue is a common goal for companies in the technology sector, as it provides a more predictable income stream.

Stakeholder Impact

• Shareholders of Markforged are expected to receive $5.00 per share in cash.
• The acquisition may lead to synergies and efficiencies, potentially benefiting employees.
• Customers may benefit from a broader range of solutions and enhanced capabilities.
• The combined company is expected to have a stronger financial position, potentially benefiting creditors.

Next Steps

• Markforged shareholder approval.
• CFIUS and other regulatory approvals.
• Closing of the transaction in Q1 2025.
• Integration of Markforged into Nano Dimension.

Key Dates

Keywords

Markforged, Nano Dimension, acquisition, additive manufacturing, 3D printing, merger, all-cash deal